Ad Markets Expected To Grow, Shift During Upcoming Election Cycle

Elections are always a boon for advertisers and the 2019-2020 election cycle is expected to be no exception. It’s projected to generate at least $6 billion in political advertising, according to a study from data, insights and consulting company Kantar. Kantar’s estimates include spending only on ads sponsored by federal candidates or campaigns, and not by political action committees (PACs).

Kantar projects a significant increase in digital ad spending in 2020, with the channel receiving 20 percent of total political ad spending, or $1.2 billion. The company says broadcast and cable television political ad spending will remain strong, with broadcast attracting $3.2 billion and cable attracting $1.2 billion. Radio ad spending is expected to total $400 million.

“Overall, an extended Democratic primary fight would likely be a short term, second quarter 2020 sugar high,” says Steve Passwaiter, general manager for the CMAG service at Kantar’s media division. “In fact, a long primary and a Democratic convention fight would most likely reduce total campaign spending as it would reduce the amount of time the eventual Democratic nominee would have to raise and spend money for the general election.”

Kantar notes that based on past results, digital remains a wild card when it comes to media spend. In 2016, the Clinton campaign spent 2.5 percent of its total budget and six percent of its media budget on digital. The 2016 Sanders campaign spent 12.5 percent of its total budget and 25 percent of its media budget on digital. Meanwhile, the Trump campaign spent more than 40 percent of its ad budget on digital in 2016. The company suggests that with such varied strategies, it remains to be seen what will occur in 2020.

Another area of emerging focus in the 2020 election cycle is the Over-the-Top/Connected TV space. The issues of scale that hindered the use of this platform in previous cycles is now in the past, as the universe has expanded beyond D2 and Comcast’s VOD service. Accordingly, political advertisers will be able to air more spots on these platforms and thus extend the reach of their messaging and better connect with younger audiences.

Passwaiter cautions a “wait-and-see” approach when it comes to Super PACs, which can also play a significant role in shaping advertising spend. “Not only do the unlimited ways they can raise money add to the overall total, but they pay a premium for television, since they do not qualify for the lowest unit rates. It will be interesting to see if a Democrat uses them in 2020 as most in the primary have rejected this type of support so far,” he says.

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